The Motor Accidents Injury Act 2017 (NSW) (“the Act”) was introduced by the State Government in response to high premiums to insurance and to decrease the rates of fraud in compensation claims as a result of a motor vehicle accidents. So, with decreased premiums, is this a win for everyone?
The real losers: Claimant’s and legal practitioners
While premiums have decreased, legal practitioners have observed that Claimants have been severely disadvantaged when making a compensation claim. A Review of the Act was conducted in 2021 by Clayton Utz and Deloitte. In their review, they had highlighted the main areas of concern:
- Definition of ‘minor injury’
Currently, the definition of a minor injury was found to be too restrictive. If your injuries are found to be minor, you will only be able to access statutory benefits for up to 26 weeks. This often results Claimants losing benefits even though their needs still continue.
- Insurer internal review process
Whenever a treatment is disputed, the Claimant must go through an internal review process conducted by the insurer. For many cases, this is seen by many as inefficient and ineffective. Furthermore, the internal review process is conducted by a team within the same insurance company causing doubt of whether the review process is independent.
- 20-month threshold to make common law claims
Currently, if your injuries are not assessed as greater than 10% Whole Person Impairment, Claimant’s cannot make a claim for common law damages until 20 months have passed since the subject accident. The Claimant also cannot engage in any settlement discussions until 24 months since the subject accident. This delay is very unnecessary.
- Legal costs structure
The legal costs allowed in defending disputes is currently very minimal. There are a strict cap on recoverable fees and does not allow for any fees to be paid for initial/ad hoc legal services. This demotivates legal practitioners and prevents many Claimants from benefitted fully from legal representation.
- Prescribed six-month period for claiming statutory benefits
Currently, all Claimants are able to claim statutory benefits regardless of fault and injuries. However, if your injuries are considered minor and/or you’re mostly at fault, the benefits ceased after 26 weeks. This timeframe is far too less as Claimants may need more time to recover.
What do you think of the Act so far? Would you sacrifice benefits Claimants in favour of lower premiums?
Our team at Alliance Compensation and Litigation Lawyers are always monitoring the changes to motor vehicle accidents. If you like to know more about us and our service, please do not hesitate to contact our firm.
For more information about the Review and recommendations, be sure to check out the discussion paper here.
For further inquiries please contact us for a free consultation or call 02 8764 1776.
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